Mid-Term Exam II Marketing 405 Retailing
Summer 2010
Exam Instructions: This exam is designed to measure your understanding of concepts that
were discussed in your textbook. The questions are multi-part- please be sure to answer each
part of the questions. You are free to consult these materials and your colleagues when
preparing your answers to questions below, but please the words you choose for your answers
should be your own. You also may consult Wikipedia as well. Each question is equally
weighted and I expect about 3/4 to one & 1/2 pages in length, per answer for a total of about
6-7 pages in length. Focus is one chapter’s one through seven.
Please answer the following questions:
1. What is CRM? Why do retailers want to calculate lifetime customer value for their
customers? How could a retailer use transaction data, customer contacts, preferences,
and customer response to marketing activities in its customer database?
2. Assume you are a grocery buyer for canned fruit and vegetables at a 5 store
supermarket chain. Del Monte (DM) has told you and your boss that it would be
responsible for making all merchandising decisions for three merchandise categories.
DM will now determine how much to order and when shipments should be made. It
promises a 10% return on gross margin dollars over the next year. Would you take DM
up on its offer? Why or why not?
3. What are the advantages and disadvantages of manufacturer and private label brands?
Does your favorite clothing store have a strong private label offering? Should it?
4. What factors should be considered in dividing-up the advertising budget among a
store’s different merchandise areas? Which of the following should receive the highest
advertising budget: staple, fad, fashion, or seasonal merchandise? Why?
5. How are changing demographics of the workforce changing staffing and recruiting
efforts for retail, sales and management positions? What do you recommend for
companies to better manage workforce diversity given your own personal experience?
6. Generally speaking, departments located near entrances, on major aisles, and on the
main level of multi-level stores have the best profit-generating potential. What
additional factors should be considered when deciding the location of departments?
Give examples.
7. What do you think the most important business environmental trend is today that is
affecting retailers? How should retailers respond to this trend more effectively?